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Numbers show a slowdown in home building

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By Johnathan Ryan

Retirees from Northern states and young professionals have been fueling the Charlotte home market in recent years, but the greater Charlotte area, including Lancaster County, is in the same boat with the rest of the country and slowing new home development rates.

Bruce Morrow, regional vice president of the JM WeichertGroup, said area home developers have reduced building rates in the third and fourth quarter of this year, compared to the same period in 2006. That has coincided with announcements of massive defaults on subprime mortgages and the resulting problems created for this country's financial sector.

"I don't have those exact numbers, but I know it's down," Morrow said. "Developers are slowing up with things."

He lumps Lancaster, Chester and York counties into his general assessments of the Charlotte market, saying the counties are "seeing spillover" from the large city.

Lancaster County Administrator Steve Willis said the number of permits for new single-family homes in Lancaster County dropped by 35.8 percent from in the third quarter ,compared to the second quarter of this year, based on a report from the Catawba Regional Council of Governments last month.

Willis wasn't surprised to see that the concentration of those permits were found in Indian Land, the part of the county that has been booming this decade.

Lancaster County wasn't alone in the substantial drop in permits. There was a 26.3 percent drop for York County and a 30.3 percent for Chester County

But Morrow suggests the trend may change in 2008. He said area home developers that he has talked to are planning to resume more aggressive building in mid-2008. Right now, their focus is selling plentiful inventories of new homes in the region.

Morrow's company, which just entered the local market, assists developers in strategically marketing new properties.

Morrow said Charlotte is still a hot market for sales, especially in the Center City area. But farther into the suburbs, including bordering South Carolina counties, new home sales have cooled, and that corresponds with the current national trend.

Still, the Charlotte home market continues to benefit from its growing reputation as an attractive place for retirees looking for lower home prices, taxes and a moderate climate. The Charlotte area's strong job market in the financial sector contributes to the influx of younger newcomers looking for new homes.

And unlike other states such as Florida and New Jersey, which have seen significant spikes in home prices in recent years, prices in this area aren't going through the roof.

"Two, 3 and 5 percent increases each year and that's about it," Morrow said. "This area keeps churning."

Contact Johnathan Ryan at 416-8416 jryan@thelancasternews.com